North American M&A volume increases in May, despite decline in value

PE and VC volume and value both up month-on-month and year-on-year

There were 2,037 mergers and acquisitions (M&A) worth an aggregate USD 146,217 million targeting North American companies announced in May, according to information collected by Bureau van Dijk, a Moody’s Analytics company, and the leading publisher of company information. In terms of volume, this represents a 4 per cent increase over the four weeks under review, while value declined 4 per cent from 1,956 deals worth USD 153,054 million in April. The trend was reversed on a 12-month comparison as volume fell from 2,315 deals, while value improved on USD 133,997 million in May 2017.

Bureau van Dijk’s research shows the majority of the top 20 deals by value featured US-based businesses. Two deals exceeded USD 10,000 million during May and together accounted for 15 per cent of total value. The largest of these involves Westinghouse Air Brake Technologies acquiring General Electric Company’s transportation business for USD 11,100 million. This was followed by the Williams Companies, a crude oil transportation service provider, buying the remaining stake it did not own in its US natural gas pipeline operator, Williams Partners, for USD 10,500 million. Canada’s largest deal placed ninth overall as Canadian Natural Resources sold an 8 per cent stake to undisclosed acquirors for USD 3,412 million, in a bid to raise proceeds to offset debt.

Bureau van Dijk’s data shows that both the volume and value of private equity and venture capital (PE and VC) investment in companies based in North America increased in May to 1,390 deals worth USD 41,232 million. In terms of volume, this represents a 7 per cent increase on 1,300 deals in April and a 2 per cent improvement on 1,368 deals in May 2017. Value was up 11 per cent from USD 37,054 million month-on-month and 3 per cent year-on-year from USD 39,957 million.

Lisa Wright, director at Bureau van Dijk, commented, “Although North America’s result for May is not particularly encouraging in terms of value, some comfort can be taken from the fact that Canada performed well. The value of deals targeting companies based in the country reached its highest level since January 2018. It is also encouraging to note that two deals broke the USD 10,000 million-barrier in the month under review, meaning that, even if dealmaking has not quite kept pace with previous months, buyers are still willing to pay high prices for companies in the region.”